The U.S. suffers from sash glut

The U. S. economy faces some problems. A pandemic is barrier, but has not developed into a financial crisis yet because it has not damaged credit markets or household balance sheets, as the housing bubble of the early 2000s did. Instead, the pandemic caused a sharp, brief recession.

Today, the unemployment rate has fallen back below 5 percent. The value of homes; the largest asset for most families, has continued rising.

The S&P 500 is more than 30 percent higher than it was before the pandemic. the federal government, across both the Trump and Biden administrations, has pumped trillions of dollars into the economy, much of it through checks sent directly to people. As a result, incomes have surged.

The full picture is a country relatively flush with cash. “The household balance sheet is far and away the strongest part of the economy’s balance sheet. Cash glut has created complications; including labor shortages, rising inflation and supply-chain problems.